Price Tag on Carbon

The New York Times provides an in-depth look at how systems carbon pricing systems are working in California, New England, and Europe.

KEWAUNEE, Wis. — Bryan T. Pagel, a dairy farmer, watched as a glistening slurry of cow manure disappeared down a culvert. If recycling the waste on his family’s farm would help to save the world, he was happy to go along.

Out back, machinery was breaking down the manure and capturing a byproduct called methane, a potent greenhouse gas. A huge Caterpillar engine roared as it burned the methane to generate electricity, keeping it out of the atmosphere.

The $3.2 million system also reduces odors at Pagel’s Ponderosa Dairy, one of the largest in Wisconsin, but it would not have been built without a surprising source of funds: a California initiative that is investing in carefully chosen projects, even ones far beyond its borders, to reduce emissions as part of the battle against climate change.

“When they came out here and told us they were willing to send us checks, we were thrilled,” Mr. Pagel said.

California’s program is the latest incarnation of an increasingly popular — and much debated — mechanism that has emerged as one of the primary weapons against global warming. From China to Norway, Kazakhstan to the Northeastern United States, governments are requiring industries to buy permits allowing them to emit set levels of greenhouse gases. Under these plans, the allowable levels of pollution are steadily reduced and the cost of permits rises, creating an economic incentive for companies to cut emissions. Read more.